Archive for the ‘financial calamity’ Category

A decade ago, feds resisted a regulator’s warning

October 20, 2008

By Anthony Faiola, Ellen Nakashima and Jill Drew
Journal Star; Lincoln NE
and The Washington Post

A decade ago, long before the financial calamity now sweeping the world, the federal government’s economic brain trust heard a warning and declared in unison: You’re wrong.

The meeting of the President’s Working Group on Financial Markets on an April day in 1998 brought together Federal Reserve chairman Alan Greenspan, Treasury secretary Robert Rubin and Securities and Exchange Commission chairman Arthur Levitt — all Wall Street legends, all opponents to varying degrees of tighter regulation of the financial system that had earned them wealth and power.

Their adversary, although also a member of the Working Group, did not belong to their club. Brooksley Born, the 57-year-old head of the Commodity Futures Trading Commission, had earned a reputation as a steely, formidable litigator at a high-powered Washington law firm. She had grown used to being the only woman in a room full of men. She didn’t like to be pushed around.

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